An Attack on Government, A Response

Chris Hayes has an interesting article out that got me thinking about the problems with free-market primacy. Hayes reviews a provacative book by economist Bryan Caplan that proposes that voters are irrational, and hence choose irrational economic policy that generate inefficient market outcomes. Here's the summary of the argument:

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JCT Score: Min Wage $4.8 bn. Tax Package

The Joint Committee on Taxation's 10-year score of the $4.8 billion "Small Business and Work Opportunity Tax Act," adopted by Congress yesterday as part of the $120 billion war spending supplemental bill (now awaiting the president's signature) is: here.

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Some Concrete Costs of the War Debate

It's taking a while for Congress and the President to work out their differences over the war funding bill. This wait isn't harming the troops, but it is costing people money. That's because there's a minimum wage raise attached to the war funding bill. It raises it from $5.15 to $5.85 60 days after enactment, and then to $6.15 a year after enactment, and $7.25 after two years.

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The Health Care Mountain

Ezra Klein has an excellent post on the nature of long term fiscal health. Given this chart from a Center on Budget and Policy Priorities report, Klein wonders why Social Security get so much attention. Or, as he puts it: Look at that gentle slope for Social Security! You could do that in Rockports! Mt. Medicare and Medicaid, by contrast, require climbing gear.

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More on What's Wrong With Health Care

If you've got 45 minutes, take a look at this article in the New York Review of Books. It's an analysis of how doctor's think, and how bad habits of mind promote inefficiency and bad outcomes in the health care system.

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FMOC Holds Steady at 5.25 Percent

We tend not to venture over into monetary policy all that much, but it and fiscal policy are closely enough related that we thought we'd try. The non-news of the Fed's Free Market Open Committee's decision this week to hold the target Fed interest rate at 5.25 percent -- where it's been for the last year -- reflects some factors below, with a fiscal consequence noted further below. The Economists' View identifies these factors and notes behind the FMOC decision:

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    The Biggest Driver of the Long-Term Fiscal Challenge

    Doing a bit of research into mandatory spending, I came across this GAO document, which contains this bit: Among mandatory spending programs...the health area is especially important because the long-term fiscal challenge is largely a health care challenge. Contrary to public perceptions, health care is the biggest driver of the long-term fiscal challenge. This cannot be said enough: health care is the biggest driver of the long-term fiscal challenge.

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    Economic, Fiscal Round-Up: 1Q07 and 4/07

    Some important economic barometers and commentary, mostly pointing to a slowdown in the overall economy, below.
    • L. Josh Bevins, Economic Policy Institute -- GDP growth continues deceleration
    • John Irons, Center for American Progress -- April Job Growth Disappoints
    • CBO -- Federal Fiscal Performance: Monthly Budget Review
    • Bureau of Economic Analysis -- 1Q07 GDP growth factors summarized:

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    Humble Submission For the CAP-Inclusion Debate

    Responding to the new CAP anti-poverty plan, the folks at Inclusionist.org have started up an interesting debate on how to talk about, think about, and address poverty. This post should get you caught up. Call me a kool-aid drinker, but I'm taken in by the Inclusionist people. I like the way they think, perhaps more so than the way they name things. I mean, the term "inclusion" just sounds too social, when we're really talking about pocketbook, security, and opportunity issues. Their work's cut out for them on that front, if they ever want the term and their definition of it to become mainstream.

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    Free Market Follies: The Medicare Advantage Program

    Kevin Drum, commenting on a New York Times story about a Medicare program that pays private insurers more per patient than they pay directly to doctors:

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